The firm and its directors have also been "restrained from accessing the securities market and further prohibited from buying, selling or otherwise dealing in the securities market, either directly or indirectly, till further directions".
    
An initial probe by Securities and Exchange Board of India (SEBI) found that Suraksha Agrotech raised nearly Rs 11.46 crore through allotment of redeemable preference shares (RPS) to 13,612 investors during 2009-10, 2010-11 and 2011-12.

Finding prima facie evidence that the fund raising activity by the company was in violation of various norms, SEBI said steps were required "to ensure that only legitimate fund raising activities are carried on by Suraksha Agrotech and no investors are defrauded".
    
Passing an interim order on Monday, the market regulator has asked Suraksha Agrotech not to mobilise any further funds from investors "through the issue of RPS or through the issue of equity shares or any other securities, to the public and/or invite subscription, in any manner whatsoever, either directly or indirectly till further orders".
    
Further the company and its six directors "are prohibited from issuing prospectus or any offer document or issue advertisement for soliciting money from the public for the issue of securities, in any manner whatsoever, either directly or indirectly, till further orders".
    
The entities have also been asked not to dispose any assets acquired through the issue of RPS as well as not to divert any funds raised from investors.
    
Besides, Suraksha Agrotech and its directors have to provide a full inventory of all its assets and properties and furnish all relevant information with SEBI within 21 days.
    
SEBI had received a reference on May 8, 2013 from the Bureau of Investigation, Assam alleging mobilisation of funds through the illegal issue of preference shares by Suraksha Agrotech.

Latest News  from Business News Desk